Tag Archives: RMA

If you grow CORN or TOMATOES and have crop insurance ! one final REMINDER! JUNE 10TH is the final planting date for corn and tomato crop insurance policies. If you have corn or tomato crop insurance policies be sure to get your crops in the ground before the June 10th deadline or you may be subjected to late planting production guarantee reductions!

JUNE 10TH is the final planting date for corn and tomato crop insurance policies. If you have corn or tomato crop insurance policies be sure to get your crops in the ground before the June 10th deadline or you may be subjected to late planting production guarantee reductions!

ATTENTION Growers with FRUIT crop insurance!!! If you have a blueberry, cranberry, peach or apple fruit crop insurance policy, acreage reports for that policy are due JANUARY 15! If you have any questions, please contact your crop insurance agent or our office at 856-769-0090 Happy Holidays!!!!

Crop insurance companies already have paid $9.1 billion in indemnity payments to U.S. farmers for 2011. That’s a new record and actually the largest loss claims in the history of the program according to USDA’s Risk Management Agency. And only 81% of claims have been finalized.

Former USDA Chief Economist Keith Collins says during the past four years more than $27 billion in private-backed crop insurance has been paid to farmers affected by market drops or natural disasters. At the same time, however, Collins says Congress has reduced the federal investment in crop insurance by more than $12 billion.

“With those large loss claims, with the funding cuts in the program, we now have a program that’s being delivered probably more efficiently and effectively than ever,” Collins said. “I think we have to be very careful in the 2012 Farm Bill to not do damage to the heart of this program and that is the delivery and the infrastructure. Farmers say this is their most important program, they want this program and without a sound crop insurance program with a capable and effective delivery structure there could be big problems in agriculture if we don’t have this effective protection in place.”

Collins says producers are doing anything and everything they can to meet domestic and global needs for food, feed and fuel. This year Collins says there are 264 million acres covered by crop insurance. The growing demand has caused commodity prices and land values to continually spike and he says increased planting means a higher demand for crop insurance.

“So the large acreage and high prices combined to increase the liability insured value of the crops by quite a bit,” Collins said. “As that value goes up that increases risk exposure of both farmers and the companies that deliver the program. And then when you have bad yields like we had in 2011 the result of that then is very large loss claims; billions of dollars in damages and that really shows the value of crop insurance to American agriculture.”

That’s because without payouts Collins says producers wouldn’t have the means to pay their bills and their bankers, lenders, input suppliers and others associated with their operations would all share in the losses without crop insurance to fill that gap.

Corn, cotton and wheat, just three of more than 128 crops covered by crop insurance last year, account for 70% of the indemnities paid so far. Informa projects the 2012 U.S. corn crop will increase to 94 million acres planted from 92.3 million acres planted in 2011. From previous statistics at least 80% of eligible acres should be protected by private-backed crop insurance policies.

SUBJECT: Verifiable Record Requirements to Qualify for Fresh Apple Production by Unit.

BACKGROUND:

On December 22, 2010, the Risk Management Agency (RMA) issued Informational Memorandum PM-10-071 to provide flexibility for policyholders to adapt their record keeping process to meet the new requirement that at least 50 percent of the production from fresh apple acreage in each unit was sold as fresh apples in one or more of the four most recent crop years in order to qualify for the fresh apple price. Approved Insurance Providers (AIPs) were allowed to consider records of total production (rather than by unit) from the 2007 through the 2010 crop years that reflect fresh apple sales.

Since the issuance of Informational Memorandum PM-10-071, RMA has continued to receive comments that apple producers still find it too difficult and inappropriate to maintain separate records by unit after the apple production has left the field. Apple producers point out that while they can and do maintain records of production by unit, once the apples are delivered to a warehouse, which is often a third party, for later sales and distribution it is virtually impossible and/or impractical to expect all the apples to be tracked by unit. Apple producers have requested RMA waive the new record requirement by unit for the 2012 and succeeding crop years by allowing them to provide records that demonstrate at least 50 percent of their total apple production was sold as fresh in order to qualify for the fresh apple price.

ACTION:

Effective for the 2012 and succeeding crop years, policyholders who do not have separate records by unit of fresh apple production in one of the last four years but do have records of total fresh apple production, may still be able to qualify for the fresh apple price. AIPs may consider records of total production (rather than by unit) from one of the four most recent crop years that reflect fresh apple sales. If only a portion of the acreage is reported as fresh, and the total amount of production sold as fresh can reasonably be determined to be reflective of at least 50 percent of the production that would have been from the apple acreage reported as fresh, such records may be used as verifiable records attributable to that portion of the acreage as fresh. Policyholders still must designate all their acreage by type (i.e. fresh or processing) by the acreage reporting date.

The AIPs should remind their agents and inform their policyholders that by designating fresh apple acreage on the acreage report, the policyholder is certifying they have verifiable records to support that they have sold in one or more of the four most recent crop years at least 50 percent of the total production as fresh apples (rather than by unit) from acreage reported as fresh apple acreage.

A verifiable record must reflect the value received was commensurate with the value of fresh apples versus processing apples. It is incumbent upon the policyholder to provide records, when requested, that demonstrate the value received for sold production is consistent with the value of fresh apple production. Section 16J(2) of the 2012 FCIC 18010 Crop Insurance Handbook provides guidance regarding what is considered an acceptable verifiable record.

The following examples illustrate the flexibility this action provides:

For example, for the 2012 crop year, a policyholder reports fresh apple acreage on three basic units. The policyholder is able to provide records proving at least 50 percent of the total production sold, from all three units, were sold as fresh apples in one or more of the four most recent crop years. Such records can be used as a verifiable record for all the fresh apple acreage for the 2012 crop year.

A second example would be for the 2012 crop year a policyholder reports two blocks of processing apple acreage and one block of fresh apple acreage in one basic unit. Records of fresh apple production sold from the entire unit can be used as a verifiable record provided the AIP can determine the records of total fresh apple production was sold in one of the four most recent years would reasonably account for at least 50 percent of the total fresh apple production from the block reported as fresh apple acreage for the 2012 crop year.

Agents should also be advised to remind policyholders that the prior years’ records used to certify fresh apple production become records that must be maintained for three years in accordance with the policy record retention requirements.

DISPOSAL DATE:

Effective for the 2012 and succeeding crop years or until incorporated into the Apple Special Provisions of Insurance.